FICCI-KPMG-Report-13-FRAMES

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36 The power of a billion: Realizing the Indian dream Consolidation 2012 was a year of consolidation with significant deal activity across the television value chain. The broadcasting industry witnessed action as players took the M&A route to enter new markets, expand presence in regional markets, consolidate presence in focus markets and exit non-core businesses. Television M&A activity in 2012 Language Target Stake Acquirer Comment Broadcast UTV Global Broadcasting 55 20% The Walt Disney Company India Expansion into multiple genres Living Media India Limited 56 27.5% Aditya Birla Group Strategic MCCS 57 26% ABP Group Exit from non-core genres ESPN Star Sports 58 50% News Corp MSM 59 32% Sony Pictures Television Consolidation of presence in existing genres; Disney exit from non-core genre Buy out of minority share holders MAA TV 55 30% Sony Pictures Television Regional expansion Eenadu TV 56 50% (5 channels) 25.4% (2 channels) Network 18 Media Regional expansion Distribution DEN Networks 56 1.14% Reliance Strategic Investments Strategic Digicable 56 90% Sahara Group Strategic © 2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. Content production Going forward, significant fund raising activity is expected in the distribution sector as MSOs make heavy capital investments for digitisation, and DTH providers look for funds needed for expansion and customer acquisition. For instance, Videocon D2H has filed for an IPO, Tata Sky is reported to have plans to raise INR 20 billion through an IPO, Dish TV is reported to have plans to raise INR 5.5 billion through listings abroad 62 . The broadcasting industry may also witness consolidation, as channels enter more regional markets and make significant investments in content and distribution to attract viewers who would have a larger number of offerings to choose from. 55. Financial Times, 1 February, 2012 56. Mergermarket, Bloomberg 57. Business Standard, 2 April, 2012 58. Medianama, 20 December 2012 Hathway Cable & Datacom 60 17.3% Providence Equity Partners Endemol India 61 49% CA Media Strategic Note: (*) Announced in 2011; completed in 2012 with a public offer for the 20 percent of shares owned by public shareholders 59. Timesofindia.com, 15 June, 2012 60. WSJ, 13 March, 2012 61. Livemint, 27 April, 2012 62. Business Standard, 8 December, 2012 News Corp’s exit from non-core business “ The M&E industry is undergoing consolidation across sub-sectors as well as select exits (including in TV broadcasting). While exits indicate that there are issues and challenges, they also indicate that rationality is back in the system. That will lead to stronger economics and industry health going forward. “ - Anuj Poddar Head – Strategy & Business Development, Viacom 18 Media Private Limited
The power of a billion: Realizing the Indian dream 37 “ “ Consolidation is the need of the day because many players are burning too much cash and are trying to hold on to their market share, albeit on low profitability. “ - Atul Das Chief Strategy Officer, Zee Enterprises Entertainment Limited New media has finally arrived and growing even faster than anticipated. Premium content from broadcasters and film studios is fueling high streaming consumption through web platforms and smartphones and tablets. “ - Anuj Poddar Head – Strategy & Business Development, Viacom 18 Media Private Limited The rise of digital media Online video viewership has witnessed significant traction in India, growing 45 percent 63 between Dec 2011 and Dec 2012. Online television content consumption is expected to mirror this trend, and broadcasters are catching up to expand presence across digital platforms like online portals, video platforms, and mobile applications. Availability of robust networks today has enabled secure delivery of live and on-demand content on multiple platforms. Several leading broadcasters have launched or partnered with mobile video delivery platforms, such as Apalya, Geodesic, Zenga, DigiVive and iStream. Google is also reported to be licensing entertainment and sports content for its Youtube website. “ Content has always been king but the king now has a queen in the form of technology. Technology is going to be the game changer especially for the news genre. However, the challenge is going to be monetization, as a lot of content is available for free. Our attempt is going to be on development of differentiated content and formats that will encourage consumers to pay for content. Advertising though will continue to be a key revenue source. “ - Preet Dhupar Chief Operating Officer - India, BBC Global News Multi-screen platforms launched by major networks Network Online Platform Availability Description MSM India Sony LIVE • Online on sonyLIV.com • Free mobile applications • Live and VOD service; episodes of current and previous shows Zee Network Star Network Viacom 18 Ditto TV Star Player Brand specific online platforms Source: Websites and Industry discussions conducted by KPMG in India As consumption of television content across platforms rises further, a key concern for broadcasters and advertisers alike would be the availability of a measurement platform that integrates viewership across multiple media. 63. Industry discussions conducted by KPMG in India • Online on dittotv.com • Free mobile application • Online on Startv.in • Paid mobile applications • Online platforms: Colors, MTV, Nickindia, Sonicgang • More than 50 channels across broadcasters; more than 100,000 downloads since launch in February 2012 • Live and VOD content in short form (4-5 minutes) and long form (22 minutes) for current and previous shows • Viewership increase of 80 percent over last 6 months; with 70 percent of return viewers • Live and VOD service © 2013 KPMG, an Indian Registered Partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.
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06 Round up of the year that was Th
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FICCI 2013 143 “ The Amendments t
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11 Technology The power of a billio
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Acknowledgement We acknowledge the
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